Saturday, July 20, 2024

“Stone Point Capital and CD&R Secure Purchase of Truist Insurance Holdings”

Stone Point Capital and CD&R Secure Purchase of Truist Insurance Holdings! Truist Financial Corporation (NYSE: TFC) just made a big announcement: they’ve sealed the deal to sell their last piece of Truist Insurance Holdings (TIH) to a group led by some heavy hitters in the private equity world, Stone Point Capital and Clayton,

Dubilier & Rice, along with Mubadala Investment Company and a few other players chipping in.

This all-cash handshake puts TIH’s worth at a cool $15.5 billion, or about 18 times its core earnings for 2023. Trust is looking at a nice bump from this deal; its capital ratio is expected to jump by 230 basis points, and its per-share book value is set to rise by $7.12, or 33%. But selling TIH is going to make a slight dent in their 2024 earnings per share, estimated at a 20-cent drop, assuming they reinvest the $10.1 billion they get from this in something that yields 4.5%.

Post-sale, Truist’s got plans to look into various ways to use that cash, aiming to keep their earnings steady and maybe even reshuffle their balance sheet to cover the earnings TIH was bringing in. Of course, all of this depends on how the market’s doing and a bunch of other factors.

Bill Rogers, the head honcho at Truist, said they’re pretty happy to have this deal in the bag. It’s going to make their balance sheet stronger, let them keep up their earnings, and give them more wiggle room to pump up their core banking business. He’s also tipping his hat to the journey with TIH, looking forward to what Stone Point and CD&R do with it next.

Stone Point Capital and CD&R

Stone Point and CD&R are bringing their A-game to TIH, promising deep industry know-how and a plan to grow TIH in the fast-changing world of insurance brokerage. They’re looking to beef up TIH with new tech and services, making it an even bigger player in the game.

John Howard, the big boss at TIH, is all in on this new chapter. He’s talking up the scale and expertise Stone Point and CD&R bring to the table, along with the financial muscle from their new backers. He’s excited about growing TIH and making it even more valuable to clients and partners.

Chuck Davis from Stone Point is ready to roll, too. He’s been eyeing TIH for a while and is stoked about taking things further with the TIH team. Over at CD&R, David Winokur is also buzzing about the deal, focusing on enhancing TIH’s services and making it a top spot for talent in the industry.

They’re all set to wrap this up in the second quarter of 2024, waiting on the green light from regulators and ticking off a few other boxes. Truist’s board is all in, giving the deal their unanimous thumbs up.

To get into the nitty-gritty, Truist is hosting a call to walk through the details of the transaction, with a live webcast and dial-in for all setups.

On the advisory front, Morgan Stanley & Co. LLC is leading the charge for Truist, with a squad of other big names in finance and law pitching in for both sides.

Trust Conference Call

A bit about the Truists: they’re all about using their financial clout to make lives and communities better. They’re a top dog in the U.S. banking scene, offering a wide range of services from their Charlotte, NC, headquarters. And thanks to Truist’s resources, TIH is a big deal in the insurance brokerage industry.

Stone Point Capital and CD&R are no strangers to the financial services sector, with a track record of making smart moves and growing businesses. Mubadala Investment Company, bringing in a global perspective, manages a hefty portfolio aimed at sustainable returns for Abu Dhabi’s government.

This deal’s got everyone talking, showing off Truist’s strategy, the strength of their insurance business, and the dedication of their team. It’s a forward-looking move, with eyes on the future and how to keep delivering value all around.

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